RBA raises cash rate to 4.60%, a 15-year high, in fourth hike of 2026

Australia’s central bank has raised its official cash rate to 4.60%, the highest level in 15 years, in a unanimous decision driven by stubborn inflation and a worsening global outlook.

The Reserve Bank of Australia board, which met on Monday and Tuesday, lifted the rate by 25 basis points — the fourth hike of 2026. The bank had previously raised rates three times this year to 4.35%, then paused at its June and August meetings.

“Inflation remains elevated and some of the upside risks flagged in August are materialising,” the board said in its post-meeting statement. “The conflict in the Middle East has broadened and global energy prices are now much higher than had been assumed in the August forecasts.”

The statement also pointed to “AI-related demand driving rapid growth in global prices for technology-related goods” and pressure on domestic capacity, adding that “recent inflation outcomes in Australia were stronger than expected at the previous meeting.”

“The Board will continue to do what it considers necessary to bring inflation sustainably back to target, including increasing the cash rate target further if needed,” the board said.

The move was widely anticipated — about 90% of Finder’s panel of experts had predicted the hike. It leaves mortgage holders facing their highest borrowing costs since 2011. Mortgage Choice estimates minimum repayments on a $500,000 home loan will rise by about $80, while Canstar figures cited by Homely put the increase at roughly $91 a month on a $600,000 loan over 25 years.

The RBA has noted that households are “not under widespread stress”, with about 40% of mortgage holders holding two years of repayments in offset accounts, according to figures presented to the Senate earlier this month.

The next board meeting is on 2–3 November. Market pricing is split on whether a further hike follows, with ANZ forecasting a move to 4.85% while Commonwealth Bank and Westpac expect a hold.

Sources

• Australian Broker: RBA makes interest rate call — decision, unanimous vote, board statement quotes
• Mortgage Choice: Rate shock — RBA hike pushes mortgage costs to 15-year high — fourth hike of 2026, $80/month impact, household stress figures
• Money magazine: RBA raises cash rate to 4.60% — further-hike guidance, 2011 comparison
• Homely: RBA raises rates to 4.60% as property prices fall — Canstar $91/$364 impact figures